EXCLUSIVE: Seedbrite, Coolwater Join Forces to Offer VC Investments to RIAs
Seedbrite Ventures, a platform that aims to democratize access to venture capital for registered investment advisors (RIAs) and family offices, and their clients, has entered a partnership with Coolwater Capital to lead their venture manager investment strategy.
Raising over $2 billion in capital in the venture capital arena, Coolwater is an investment firm that models to be an incubator and / or accelerator to support emerging funds, typically with sub-$150 million in assets under management, at the earliest stages of their lifecycle.
Coolwater CEO Winter Mead, who has worked with more than 240 emerging venture capital managers in the technology space, told Connect Money, “We look for great investors and partner with them as early as possible. We help them think about their go-to-market, what are they building, and all the materials they’ll need to launch a successful fund.”
As part of the collaboration, Seedbrite and Coolwater will review and make recommendations regarding Seedbrite’s current managers, curate a high-quality venture manager pool for the Seedbrite platform, Seedcraft, provide due diligence and summaries on the manager pool, and offer investment summaries and recommendations for all portfolio company investments.
Integrating VC investments offers a favorable opportunity for RIAs and family offices to enhance client services and results. It can provide differentiation, diversification, potentially lucrative returns, and access to developing technology, all of which can greatly improve returns for clients.
Seedcraft “allows RIAs and their clients to invest directly into portfolio companies alongside multiple venture managers,” providing tax benefits and accessibility to the “same VC deals as seasoned investors in Silicon Valley,” Seedbrite CEO Josh Fagan told Connect Money. “RIAs are gravitating towards early-stage companies to get in on the ground floor, so there is more potential upside.”
Founded in 2021, Salt Lake City-based Coolwater is not an investment advisor and does not recommend which funds to invest in. Its focus is on providing data and information so that investors can “get smarter” more quickly and make better decisions. The firm aims to help investors go from a “great investor to a great asset manager,” Mead added.
In terms of the benefits of the partnership, Mead said both firms agree that the “alternative markets have changed,” highlighting that given the democratization of the financial markets investors have more choices. Furthermore, the firms are aligned in that there is a distribution, due diligence and discovery challenge in terms of how to provide investment opportunities to anyone looking for that choice.
“Coolwater and Seedbrite are passionate about the same thing: 1) supporting emerging managers and 2) allowing average accredited investors access to venture capital,” Fagan said.
Citing Coolwater’s expertise in due diligence and sourcing of managers and Seedbrite’s relationship with RIAs, family offices and broker-dealers, Fagan added that, [The partnership] is “a strategic initiative and we complement each other extremely well.”
Both firms already have an agreement in place and are currently working on funds which Coolwater is currently curating managers. “We’re stocking the pond,” Fagan said. “We’re building out the platform and featuring 10 to 15 managers in our starting lineup.”
There are more than 6,000 emerging managers in the venture capital space, according to Mead “What we’re trying to do with this partnership is bring to light what we believe are high-quality, tier 1 smaller fund investment opportunities. We’re providing packaged information that those individuals can then use to make an informed decision on their investments.”
Mead noted that some of the more notable investment themes are deeptech, as it applies to climate and defense, artificial intelligence (AI) infrastructure, and vertical AI. Fintech and healthcare also remain popular investments.